2012 Initiative Petitions
Approved for Circulation in Missouri

Statutory Amendment to RSMo Chapters 149 and 196, Relating to Local Taxes on Cigarettes or Tobacco Products, version 6, 2012-126

Be it enacted by the people of the state of Missouri:

Section 149.192 and 196.1003 are amended to read as follows:

149.192.1 Until the effective date of this initiative, the general assembly hereby occupies and preempts the entire field of legislation increasing the taxation of cigarettes and tobacco products to the complete exclusion of any order, ordinance or regulation by any political subdivision of this state. Until the effective date of this initiative, any future orders, ordinances or regulations in this field shall be null and void. Until the effective date of this initiative, no county, city, town, village, municipality, or other political subdivision of this state shall adopt any order, ordinance or regulation increasing the tax levied on cigarettes and tobacco products. Until the effective date of this initiative, the tax levied by any county, city, town, village, municipality, or other political subdivision of this state shall not exceed the amount of tax levied on September 30, 1993.

2. Subsections 2 through 8 of this section shall be known as the “Local Voters’ Right to Set and Control Local Tobacco Taxes Initiative.”

3. After the effective date of this initiative, local voters shall have the right to set and control local tobacco taxes in cities and counties.

4. Any local tobacco tax approved by local voters under this initiative shall be used solely for local job creation, local health care, local public education, local tobacco use prevention and quit assistance, or other local use specifically approved by local voters.

5. As used in this initiative, the following terms have the following meanings:

(1) “Local voters” shall not mean the General Assembly nor the local governing body in a city or county, but shall only mean a majority of the qualified voters casting ballots in an election in a city or county on a local tobacco tax measure, whether submitted to local voters by the local governing body or by local initiative.

(2) “Right to set and control local tobacco taxes” means the right, power and authority to set, control, impose, establish, levy, collect, fix, reduce, eliminate or change the rate, base or dedicated use of a city or county excise tax on cigarettes or tobacco products, or other tax on cigarettes or tobacco products, or on the selling of cigarettes or tobacco products, or on the business of selling cigarettes or tobacco products.

6. All existing local tobacco taxes in place on the effective date of this initiative shall remain in effect provided, however, that the rate, base or dedicated use of such local tobacco taxes may only be modified with the approval of local voters.

7. The provisions of this initiative are self-executing. Governing bodies in cities and counties are authorized, but not mandated, to submit measures to local voters to set and control local tobacco taxes at authorized elections occurring after the date this initiative is approved by voters. In addition, the people are authorized, but not mandated, to submit measures to local voters by initiative petition to set and control local tobacco taxes at authorized elections occurring after the date this initiative is approved by voters. The people may submit measures under local initiative petition procedures where otherwise available or, under this subsection, by submitting to the appropriate local election authority a petition signed by five percent of the qualified voters of the city or county as measured by the total number of votes cast for governor in such city or county at the last general gubernatorial election prior to the filing of the petition. For purposes of this subsection, “authorized election” means, for counties, including those recognized under Article VI, Section 31, any election day after January 1, 2013 and, for cities, any election day after July 1, 2013. However, where the people submit a measure to set and control local tobacco taxes through initiative petition under this subsection, the authorized election shall be, in the case of a county, including those recognized under Article VI, Section 31, the earliest election day, whether a general, primary, general municipal, or other established election day, after signatures are submitted that is also after January 1, 2013, and in the case of a city, the earliest election day, whether a general, primary, general municipal, or other established election day, after signatures are submitted that is also after July 1, 2013.

8. All of the provisions of this initiative are severable. If any provision of this initiative is found by a court of competent jurisdiction to be unconstitutional or unconstitutionally enacted, the remaining provisions shall be and remain valid.

196.1003. Any tobacco product manufacturer selling cigarettes to consumers within the State (whether directly or through a distributor, retailer or similar intermediary or intermediaries) after the date of enactment of this Act shall do one of the following:

(a) become a participating manufacturer (as that term is defined in section II(jj) of the Master Settlement Agreement) and generally perform its financial obligations under the Master Settlement Agreement; or

(b) (1) place into a qualified escrow fund by April 15 of the year following the year in question the following amounts (as such amounts are adjusted for inflation) -

1999: $.0094241 per unit sold after the date of enactment of this Act;

2000: $.0104712 per unit sold;

for each of 2001 and 2002: $.0136125 per unit sold;

for each of 2003 through 2006: $.0167539 per unit sold;

for each of 2007 and each year

thereafter: $.0188482 per unit sold.

(2) A tobacco product manufacturer that places funds into escrow pursuant to paragraph (1) shall receive the interest or other appreciation on such funds as earned. Such funds themselves shall be released from escrow only under the following circumstances -

(A) to pay a judgment or settlement on any released claim brought against such tobacco product manufacturer by the State or any releasing party located or residing in the State. Funds shall be released from escrow under this subparagraph (i) in the order in which they were placed into escrow and (ii) only to the extent and at the time necessary to make payments required under such judgment or settlement;

(B) to the extent that a tobacco product manufacturer establishes that the amount it was required to place into escrow on account of units sold in the state in a particular year was greater than the Master Settlement Agreement payments, as determined under Section IX(i) of that Agreement including after final determination of all adjustments, [State's allocable share of the total payments] that such manufacturer would have been required to make on account of such units sold had it been a participating manufacturer, [in that year under the Master Settlement Agreement (as determined pursuant to section IX(i)(2) of the Master Settlement Agreement, and before any of the adjustments or offsets described in section IX(i)(3) of that Agreement other than the Inflation Adjustment) had it been a participating manufacturer,] the excess shall be released from escrow and revert back to such tobacco product manufacturer; or

(C) to the extent not released from escrow under subparagraphs (A) or (B), funds shall be released from escrow and revert back to such tobacco product manufacturer twenty-five years after the date on which they were placed into escrow.

(3) Each tobacco product manufacturer that elects to place funds into escrow pursuant to this subsection shall annually certify to the Attorney General that it is in compliance with this subsection. The Attorney General may bring a civil action on behalf of the State against any tobacco product manufacturer that fails to place into escrow the funds required under this section. Any tobacco product manufacturer that fails in any year to place into escrow the funds required under this section shall

(A) be required within 15 days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a violation of this subsection, may impose a civil penalty to be paid to the State's general revenue fund in an amount not to exceed 5 percent of the amount improperly withheld from escrow per day of the violation and in a total amount not to exceed 100 percent of the original amount improperly withheld from escrow;

(B) in the case of a knowing violation, be required within 15 days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a knowing violation of this subsection, may impose a civil penalty to be paid to the State's general revenue fund in an amount not to exceed 15 percent of the amount improperly withheld from escrow per day of the violation and in a total amount not to exceed 300 percent of the original amount improperly withheld from escrow; and

(C) in the case of a second knowing violation, be prohibited from selling cigarettes to consumers within the State (whether directly or through a distributor, retailer or similar intermediary) for a period not to exceed 2 years. Each failure to make an annual deposit required under this section shall constitute a separate violation. Any tobacco product manufacturer that violates the provisions of this section shall pay the State's cost and attorney's fees incurred during a successful prosecution under this section.